WellPoint, one of the nation's largest health insurers, has begun
notifying 75,000 members of its Empire Blue Cross and Blue Shield unit
in New York that a CD holding their vital medical and other personal
information has disappeared.
The information was on an unencrypted disc that a subcontractor
recently sent to Magellan Behavioral Services, a company in Avon,
Conn., that specializes in monitoring and coordinating mental health
and substance abuse treatments for insurance companies.
Empire began notifying the affected consumers by mail on Saturday that
their records--including their names, Social Security numbers, health
plan identification numbers and description of medical services back to
2003--had been lost. [...]
Before shipping the information to Magellan, the coding and passwords
that protect the privacy of the information was removed by a Magellan
subcontractor, Lisa Ann Greiner, an Empire spokeswoman, said Tuesday.
Janlori Goldman, the director of the Health Privacy Center, a nonprofit
organization in Washington, said the error was an "egregious breach of
privacy." She said that insurance companies were responsible under a
federal privacy law for ensuring that their contractors use adequate
security procedures.
Greiner said that the subcontractor, Health Data Management Services,
worked for Magellan, not Empire. "If any contract was breached, we are
going to take direct action," she said.
3:45:41 PM 
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